Tuesday, December 15, 2015

Oil Junkies for Jesus

by Len Hart, the Existentialist Cowboy

Face it – the United States and foreign affairs always seem to be awkward at best. At the very worst, the United States comes away having lost a friend! Involvement in Iraq was complicated by what I would call “weird” theology.

Fundamentalist Christians insist upon an unconditional pro-Israeli policy no matter what! Israel is God's chosen nation. To oppose Israel, they say, is to damn the opposing nation to hell.

Another complication is our nation's symbiotic relationship with oil producing “infidels”. GOP faithful believe that middle east oil is ours to plunder. Oil Junkies for Jesus openly boast of stealing Iraqi oil. For them, waging war for oil is not a war crime, it's a crusade; it's not an atrocity its, a commandment.

SUV's are not abominable energy hogs, they are God's own chariot. While we fear the mother of all energy crunches, Hubbert's Peak, oil junkies for Jesus look forward to just flying away from it all. In 1956, geophysicist, M. King Hubbert, working at the Shell research lab in Houston, TX predicted that U.S. oil production would peak in the early 1970s.

For his efforts, Hubbert was pilloried by oil experts and economists. Nevertheless, the 70's are remembered less for Disco Duck than for the long lines at service stations. The Arab Oil Embargo had driven home a point that the US had become an oil junkie nation. The US partnership with Arab oil producers was always a strange marriage of fundamentalist Christians from Texas and equally fundamentalist Muslims from the far flung deserts of the Middle East, primarily Saudi Arabia. Amid long lines, hot tempers and high prices, the era of cheap energy was over by the end of the 1973 Arab-Israeli War, the so-called Yom Kippur War.

The situation is complicated by what is conveniently and politically called "world terrorism" and the suspicion that the Bush administration turned a blind eye to the flow of "petro-dollars" finding their way into Saudi coffers and eventually into the hands of terrorists and, perhaps, bin Laden. In the early days of the Iraq war, the moral implications were easily assuaged: just stick a flaq on your SUV, wave a yellow ribbon from your truck!

Americans are just barely aware that they pay about one-third the price Europeans pay for gasoline! But you have to credit the GOP with resourcefulness. The Bush administration delivered a message to the faithful: war in Iraq will result in lower prices at the pump even as the official line denied that the US attack and invasion of Iraq had anything at all to do with oil. That is revisionist history.

The record of US Ambassador April Glaspie's interview with Saddam Hussein on the eve of his attack of Kuwait proves conclusively that Hussein's "problems" with the Bush family began when he tried to lower the price of oil. Apparently the nation bought the GOP line. Alternative fuels, green energy and efficient cars were no longer "in".

It was not always so. The famous Offshore Technology Conference held in Houston during the oil embargo was dominated by talk of Solar Energy, Offshore Thermal Energy Conversion, and Wind Energy. The brightest minds from MIT, Harvard, and Cambridge were there –modeling the economics of it all. It's easy to find in the 1970's the growing antipathy between big oil and the Democratic party. President Carter got caught in the cross hairs as perhaps JFK had done about ten years earlier when he promised to put an end to a Texas oil industry sacred cow –the Oil Depletion Allowance. But only a conspiracy theorist would connect that fact with his murder in Dallas, TX.

Carter's advisors, however, favored lifting price caps but his political advisors nixed the idea. Clearly, American consumers were fed up with higher prices but absurdly long lines were the only alternative. Even now consumers may not have it both ways. Energy Secretary James R. Schlesinger favored lifting Federal price caps and doing away with what he called the “government's” Byzantine allocation system". His proposal, he said, would go a long way toward spurring conservation while allocating scarce fuel more efficiently. Schlesinger said it would eliminate the long lines at the gas pump. It would mean the end of dirt cheap gasoline.

When Carter over ruled Schlesinger the press reported that the President had refused to eliminate Federal Price Caps against the advice of his own energy secretary. [See: Merrill Sheils, "The Energy Plan," Newsweek, July 23, 1979] In Houston, MIT energy economist Morris Adelman would tell us reporters:

'All in all, it was a very weak, pallid performance,' said MIT energy economist Morris Adelman. "The failure to decontrol will cost us a good deal." The future may be seen in our own past. It is simplistic to say merely that all the world's oil supplies will simply run dry, though oil supplies are finite to be sure. It is, rather, a matter of economics. Pennsylvania, for example, was America's first oil producing state –but Pennsylvania hasn't figured prominently in the oil industry in over a century.

Oil seemed limitless; after all, it took some 60 years to consume the first 10% --a curve that has continually gotten steeper. Later --the Spindletop gushers in Texas startled the world only to be exploited and abandoned in a period of some twenty years or less. Then the pattern repeated itself in West Texas. On the ranches just outside of Odessa/Midland, there is evidence that the robber barons of big oil simply walked away, abandoning wells to despoil the environment when it became no longer economically viable to operate them.

It ceased to be easy. That may explain why George W. Bush had to settle for stealing an election. In its first stages, petroleum exploration is a straight-forward technical procedure and, indeed, it was so easy wildcatters used to call it “land speculation with cash flow”. Just shoot a modern seismic "net" across a basin and let the soundings delineate the significant prospects. The largest oil and gas fields are also the biggest and easiest targets; it was so easy in its early days that even an idiot could have made money. George W. Bush's ventures went belly-up twice; that is significant. Every other idiot made money. Shrub failed to find oil amid plenty but he did find “the Lord" in a hell hole” –Odessa/Midland.

By that time, however, getting rich in oil had become more complicated. The cost of producing oil outstripped oil's value. What happened in Pennsylvania, Beaumont (Spindletop), Odessa/Midland will one day happen to Saudi Arabia, The Persian Gulf, and Russia. The Arabs –inventors of Algebra –know this even if the blythe SUV-driving American idiot does not. The demand for oil will increase from about eighty million barrels per day to about 125 million barrels per day by 2030; in the meantime, OPEC oil production will level off in 2014, if not sooner. A steep decline will begin in 2016 from which oil production will never recover.

A big crunch is very nearly here if the shortfall isn't made up. In the meantime, Halliburton, Unocal, Chevron rush to enrich themselves with Republican assistance, even complicity. The War in Iraq is just a part of the grand chessboard albeit a key one. Should Bush abandon Iraq, the American oil industry faces a crisis. It is a last desperate, ruthless grasp that has plunged the world into a "war on terror" and too many Americans have been asked to die for Halliburton --not America! Who is the genius behind the prediction that bears his name?

In 1969, Hubbert skipped Woodstock to do math. Hubbert suspected that a graph of world oil production would follow a standard statistical norm and his findings are not unlike those of Malthus who said essentially the same thing of arithmetic food production in populations which increase geometrically. Students of elementary statistics will know it as a “bell curve”. Hubbert was not appreciated in 1969 –the dawning of the Age of Aquarius. Nonetheless, he plotted a graph which predicted a peak of oil production followed by a precipitous decline.

The future is now: Hubbert is now said by experts to have made the “...only truly valid scientific projection of future oil production.” A report by the Novum Corporation bluntly states that Hubbert was correct when he forecast oil production peaking in 1969. Since that time, domestic oil production has declined to within 5% of Hubbert's 1956 predictions. The world oil map is not what it was in the 70's.

Saudi Arabia and other Persian Gulf producers still make up a quarter of the world's oil supply to be sure but new supplies are now found in Russia where production fell by one-half after the break-up of the Soviet Union. But foreign supplies are likewise finite and cannot be depended upon to bail out the US –especially given the increasingly murky role of Saudi Arabia and volatile political situations throughout the middle east. The war on terrorism cannot be counted on to bring stability to the region or to oil prices.

Dick Cheney's Halliburton, Enron, Unocal, and Chevron, for example, have long proposed a "consortium" to build a pipeline across Afghanistan to the Arabian Sea –a pipeline supported by Pakistan but opposed by the Taliban. Only the insentient would not wonder if Dick Cheney's "pipeline" figured prominently in BBC reports that the United States had promised Pakistan a "little war" with Afghanistan --a promise made months before the events of 9/11.

Some conclusions: America's addiction to oil is not just a matter of taste, lifestyle, or provincialism. It is a matter of national security. Alarms bells should have gone off when Bush promised to end world terrorism at a time when his own family is in business with the people who finance them –Saudi Arabia. Afghanistan, for example, got carpet bombed; Saudi Arabia had merely to endure some bad press. Is that because the Saudis are well-connected with Bush et al? Until fuel cell cars are made, scooters, economy vehicles, and public transportation –already popular everywhere, it seems, but in America --will become necessary in the US. The alternative is walking.

There are glimpses of the future to be seen in various out-of-the-way places across the U.S: little communities where residents live “harmoniously” with the earth in super-insulated, comfortable houses coated with hardened clay. They do organic farming and telecommute. Just a bunch of hippies, tree-huggers, and liberals no doubt –but tell me that when your heating bill outstrips the value of your latter day manor house. In the meantime, Hubbert's Peak is not a Soap Opera. It does, rather, explain why Bush and Dick Cheney (Halliburton) may have –as has been published and reported now in an increasing number of sources –threatened Afghanistan with “carpet bombs” before 9-11.

It also explains Bush's one time love of Putin. Bush didn't see Putin's soul; he saw his oil! It also explains why they have since fallen out. The US was “negotiating” pipeline rights with the Taliban; dying for God and country is one thing –but for Halliburton?

Another complication is our nation's symbiotic relationship with oil producing “infidels”. GOP faithful believe that middle east oil is ours to plunder. Oil Junkies for Jesus openly boast of stealing Iraqi oil. For them, waging war for oil is not a war crime, it's a crusade; it's not an atrocity its a commandment.

SUV's are not abominable energy hogs, they are God's own chariot. While we fear the mother of all energy crunches, Hubbert's Peak, oil junkies for Jesus look forward to just flying away from it all. In 1956, geophysicist, M. King Hubbert, working at the Shell research lab in Houston, TX predicted that US oil production would peak in the early 1970s.

Others predicted a peak occurring right about now. For his efforts, Hubbert was pilloried by oil experts and economists. Nevertheless, the 70's are remembered less for Disco Duck than for the long lines at service stations. The Arab Oil Embargo had driven home a point: the US had become an oil junkie nation. The US partnership with Arab oil producers was always a strange marriage of fundamentalist Christians from Texas and equally fundamentalist Muslims from the far flung deserts of the Middle East, primarily Saudi Arabia. Amid long lines, hot tempers and high prices, the era of cheap energy was over by the end of the 1973 Arab-Israeli War, the so-called Yom Kippur War.

The situation was complicated by what is conveniently and politically called "world terrorism" and the suspicion that the Bush administration turned a blind eye to the flow of "petro-dollars" finding their way into Saudi coffers and eventually into the hands of terrorists perhaps, bin Laden. In the early days of the Iraq war, the moral implications of this were easily assuaged: just stick a flag on your SUV, wave a yellow ribbon from your truck!

Americans are just barely aware that they pay about one-third the price Europeans pay for gasoline! But you have to credit the GOP with resourcefulness. The Bush administration delivered a message to the faithful: war in Iraq will result in lower prices at the pump even as the official line denied that the U.S. attack and invasion of Iraq had anything at all to do with oil.

That is revisionist history. The record of US Ambassador April Glaspie's interview with Saddam Hussein on the eve of his attack of Kuwait proves conclusively that Husein's "problems" with the Bush family began when he tried to lower the price of oil. Apparently the nation bought the GOP line. Alternative fuels, green energy and efficient cars were no longer "in". It was not always so. The famous Offshore Technology Conference held in Houston during the oil embargo was dominated by talk of Solar Energy, Offshore Thermal Energy Conversion, and Wind Energy.

The brightest minds from MIT, Harvard, and Cambridge were there –modeling the economics of it all. It's easy to find in the 1970's the growing antipathy between big oil and the Democratic party. President Carter got caught in the cross hairs as perhaps JFK had about ten years earlier when he promised to put an end to a Texas oil industry sacred cow –the Oil Depletion Allowance. But only a conspiracy theorist would connect that fact with his murder in Dallas, TX.

Carter's advisors, however, favored lifting price caps but his political gurus nixed the idea. Clearly, American consumers were fed up with higher prices but absurdly long lines were the only alternative. Even now consumers may not have it both ways. Energy Secretary James R. Schlesinger favored lifting Federal price caps and doing away with what he called the “government's” Byzantine allocation system".

His proposal, he said, would go a long way toward spurring conservation while allocating scarce fuel more efficiently. Schlesinger said it would eliminate the long lines at the gas pump. It would mean the end of dirt cheap gasoline. When Carter over ruled Schlesinger the press reported that the President had refused to eliminate Federal Price Caps against the advice of his own energy secretary. [See: Merrill Sheils, "The Energy Plan," Newsweek, July 23, 1979] In Houston, MIT energy economist Morris Adelman would tell me and other reporters: "All in all, it was a very weak, pallid performance," said MIT energy economist Morris Adelman. "The failure to decontrol will cost us a good deal."

The future may be seen in our past. It is simplistic to say merely that all the world's oil supplies will simply run dry, though oil supplies are finite to be sure. It is, rather, a matter of economics. Pennsylvania, for example, was America's first oil producing state –but Pennsylvania hasn't figured prominently in the oil industry in over a century.

Oil seemed limitless; after all, it took some 60 years to consume the first 10% --a curve that has continually gotten steeper. Later --the Spindletop gushers in Texas startled the world only to be exploited and abandoned in a period of some twenty years or less. Then the pattern repeated itself in West Texas. On the ranches just outside of Odessa/Midland, there is evidence that the robber barons of big oil simply walked away, abandoning wells to despoil the environment when it became no longer economically viable to operate them.

It ceased to be easy. That may explain why George W. Bush had to settle for stealing an election. In its first stages, petroleum exploration is a straight-forward technical procedure and, indeed, it was so easy wildcatters used to call it “land speculation with cash flow”. Just shoot a modern seismic "net" across a basin and let the soundings delineate the significant prospects. The largest oil and gas fields are also the biggest and easiest targets; it was so easy in its early days that even an idiot could have made money. The fact that George W. Bush's ventures went belly-up twice is significant. Every other idiot was making money. Shrub failed to find oil amid plenty but he did manage to find “the Lord" in a hell hole” – the oil fields just outside Odessa/Midland.

By that time, however, getting rich in oil had become more complicated. The cost of producing oil outstripped it's value. What happened in Pennsylvania, Beaumont (Spindletop), Odessa/Midland will one day happen to Saudi Arabia, The Persian Gulf, and Russia. The Arabs –inventors of Algebra –know this even if the blythe SUV-driving American idiot does not. The demand for oil will increase from about eighty million barrels per day to about 125 million barrels per day by 2030; in the meantime, OPEC oil production will level off in 2014, if not sooner. A steep decline will begin in 2016 from which oil production will never recover.

A big crunch is very nearly here if the shortfall isn't made up. In the meantime, Halliburton, Unocal, Chevron rush to enrich themselves with Republican assistance, even complicity. The War in Iraq is just a part of the grand chessboard albeit a key one. Should Bush abandon Iraq, the American oil industry faces a crisis. It is a last desperate, ruthless grasp that has plunged the world into a "war on terror" and too many Americans have been asked to die for Halliburton --not America! Who is the genius behind the prediction that bears his name?

In 1969, Hubbert skipped Woodstock to do math. Hubbert suspected that a graph of world oil production would follow a standard statistical norm and his findings are not unlike those of Malthus who said essentially the same thing of arithmetic food production in populations which increase geometrically. Students of elementary statistics will know it as a “bell curve”. Hubbert was not appreciated in 1969 –the dawning of the Age of Aquarius. Nonetheless, he plotted a graph which predicted a peak of oil production followed by a precipitous decline.

The future is now: Hubbert is now said by experts to have made the “...only truly valid scientific projection of future oil production.” A report by the Novum Corporation bluntly states that Hubbert was correct when he forecast oil production peaking in 1969. Since that time, domestic oil production has declined to within 5% of Hubbert's 1956 predictions. The world oil map is not what it was in the 70's.
Saudi Arabia and other Persian Gulf producers still make up a quarter of the world's oil supply to be sure but new supplies are now found in Russia where production fell by one-half after the break-up of the Soviet Union. But foreign supplies are likewise finite and cannot be depended upon to bail out the US –especially given the increasingly murky role of Saudi Arabia and volatile political situations throughout the middle east. The war on terrorism cannot be counted on to bring stability to the region or to oil prices.

Dick Cheney's Halliburton, Enron, Unocal, and Chevron, for example, have long proposed a "consortium" to build a pipeline across Afghanistan to the Arabian Sea –a pipeline supported by Pakistan but opposed by the Taliban. Only the insentient would not wonder if Dick Cheney's "pipeline" figured prominently in BBC reports that the United States had promised Pakistan a "little war" with Afghanistan --a promise made months before the events of 9/11.

Some conclusions: America's addiction to oil is not just a matter of taste, lifestyle, or provincialism. It is a matter of national security. Alarms bells should have gone off when Bush promised to end world terrorism at a time when his own family is in business with the people who finance them –Saudi Arabia. Afghanistan, for example, got carpet bombed; Saudi Arabia had merely to endure some bad press. Is that because the Saudis are well-connected with Bush et al? Until fuel cell cars are made, scooters, economy vehicles, and public transportation –already popular everywhere, it seems, but in America --will become necessary in the US. The alternative is walking.

More generally, there are glimpses of the future to be seen in various out-of-the-way places across the U.S: little communities where residents live “harmoniously” with the earth in super-insulated, comfortable houses coated with hardened clay. They do organic farming and telecommute. Just a bunch of hippies, tree-huggers, and liberals no doubt –but tell me that when your heating bill outstrips the value of your latter day manor house. In the meantime, Hubbert's Peak is not a Soap Opera. It does, rather, explain why Bush and Dick Cheney (Halliburton) may have --as has been published and reported now in an increasing number of sources –threatened Afghanistan with “carpet bombs” before 9-11.

It also explains Bush's one time love of Putin. Bush didn't see Putin's soul; he saw his oil! It also explains why the have since fallen out. The US was “negotiating” pipeline rights with the Taliban; dying for God and country is one thing –but for Halliburton?